Comcast, Verizon go after millennials with cheaper packages

CONTRIBUTED

Two of the nation's largest pay-TV operators, Comcast Corp. and Verizon Communications Inc., are marketing slimmed-down, low-cost TV bundles to young adults who might only be interested in Internet-delivered entertainment -- the so-called cord-cutters.

Two of the nation's largest pay-TV operators, Comcast Corp. and Verizon Communications Inc., are marketing slimmed-down, low-cost TV bundles to young adults who might only be interested in Internet-delivered entertainment -- the so-called cord-cutters. (CONTRIBUTED)

Bob FernandezOf The Philadelphia Inquirer

Comcast, Verizon go after millennials with cheaper packages

Some area cable television customers might want to look into whether their providers might sell them slimmed-down TV and Internet.

Two of the nation's largest pay-TV operators, Comcast Corp. and Verizon Communications Inc., are marketing low-cost TV bundles to young adults who might only be interested in Internet-delivered entertainment -- the so-called cord-cutters. Verizon, which serves Allentown with FiOS, or its fiber optic network, recently launched a new package.

The new bundle includes broadband service, local TV stations, HBO or Showtime, and a free year of Netflix for $59.99 a month, plus taxes and fees. The Internet speed is 50 megabits.

Verizon spokesman Lee Gierczynski said about 46,000 Allentown households are eligible for FiOS service; he did not have a number of customers.

Meanwhile Comcast, whose territory includes Reading and the Bucks County communities of Quakertown and Doylestown, is selling two products of "skinny bundles" aimed at younger adults, including Internet Plus.

Internet Plus, a double-play product, costs $44.99 a month and comes with the Internet, HBO and Streampix, and 10 TV channels. The Internet speed is 25 megabits per second.

The double-play product offerings, or Internet and TV services, are part of the ferment in the pay-TV industry as YouTube, Netflix, and other Internet-delivered entertainment gain footholds with Internet-savvy millennials.

Premium-network HBO and broadcast network CBS Corp. recently announced plans to offer their shows directly to consumers over the Internet -- over-the-top, fee-based products that could threaten or cannibalize pay-TV distributors.

People who purchase just the Internet and not a pay-TV service are called cord-cutters. The number of cord-cutters is expected to more than double to 16 million TV households in 2018 from 6.5 million households this year, according to research firm Magna Global.

But Comcast and Verizon say they can stay relevant by offering stripped-down TV packages to Internet-leaning millennials, or young adults in their 20s, and then broaden their TV relationships with them when they are in their 30s and 40s.

"What we saw was a need for people who valued the Internet and wanted some TV but did not value the entire video proposition," John Harrobin, chief marketing officer for Verizon's wireline and consumer mass business unit, said in a recent interview.

RCN spokeswoman Joanne Guerriero acknowledged younger consumers are interested in alternative ways to watch shows. "There are people looking to shed the more traditional ways of watching television," said Guerriero, "and we are absolutely on board with creating new packages."

Comcast's other low-cost option, the Xfinity on Campus, is included with room and board on selected colleges, including Drexel University, in Comcast's cable territory. This enables college students to watch streamed TV on laptops, tablets, and mobile phones.

Matt Strauss, senior vice president and general manager of Comcast video services, said the idea was to grab college students and younger adults and expose them to the TV ecosystem. Those young adults now are "high-speed data customers first and video second," Strauss said.

The question, said Strauss, is "how do we build relationships with these [customer] segments earlier?"